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The San Francisco’s Municipal Transportation Agency board this morning discussed how to spend $36 million it is unexpectedly receiving from the state and whether the money can prevent planned service cuts and fare increases.

The board also decided by a 5-2 vote today to declare a continued fiscal emergency, allowing them to make these types of changes to balance the budget without environmental review.

SFMTA is receiving $36 million from the state for the 2010-11 fiscal year, and $31.5 million for the following fiscal year. The funding allocation was part of a complicated gas-tax bill signed by Gov. Arnold Schwarzenegger on March 22.

Despite the incoming money from the state, board members agreed they should continue to be prudent about spending. “We’ve probably got one more year of real belt tightening,” said SFMTA executive director Nathaniel Ford.

Although SFMTA usually receives twice the amount the state allocated for the next two fiscal years, according to SFMTA staff, the money came as a surprise.

The money will help reduce the forecast budget gap for the 2010-2011 fiscal year. The gap had previously been estimated at $56.4 million, but was forecast today to be an estimated $39.3 million, which staff suggested can be partially filled with the help of various cost-cutting measures.

At today’s meeting, Ford said the first $36 million from the state won’t arrive until shortly before the current fiscal year ends July 1, but that the SFMTA is working to get an advance so that some of the funding can be used before then.

SFMTA staff proposed spending $17 million to fill the budget gaps in the current fiscal year and saving $18.9 million for the 2010-11 fiscal year.

Chairman Tom Nolan and other board members expressed support for rescinding an extra fee for premium fast pass holders interested in riding cable cars and express buses.

In addition, Ford said that SFMTA staff is working on a proposal to “defray or delay” the 10 percent service cuts that the board recently passed and that were scheduled to take effect in May.

Mayor Gavin Newsom released a statement today supporting those changes.

“I applaud the SFMTA board of directors, under the leadership of Tom Nolan, for taking decisive action this morning towards rolling back premium pass increases and service cuts scheduled for May 1,” Newsom said.

Board members also indicated today they will likely move forward with plans to extend parking meter hours and create additional metered parking spaces.

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